A “supply chain network” describes a flow and movement of materials and/or information through a supply chain, where a supply chain includes one or more entities associated with producing, handling, and/or distributing a specific product. The supply chain network describes movement of raw primary goods as well as complete products that are delivered to an end-customer. The supply chain network also describes demand from the end-customer that is sent to one or more entities within the supply chain.
Supply chain efficiencies, responsiveness, and resilience are largely dependent on a quality of a design of a supply chain network. The supply chain network periodically needs to be evaluated to account for changes to the supply chain, such as changes in shipment volumes, changes to the customer base, introduction of new systems, and obsolescence of existing systems. Designing a supply chain network is a strategic activity with a potential to provide quantum benefits in terms of costs and service levels to customers. Likewise, poor supply chain network design can result in service problems. For example, if a supply chain network includes too many entities close to each other (e.g., a company opens up too many stores or offices close to each other), this can lead to under-utilization of resources and increased costs. Further, if the supply chain network includes too few entities (e.g., the company opens up too few stores or offices), this can lead to poor coverage of the target market.